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Q&As refer to the provisions in force on the day of their publication. The EBA does not systematically review published Q&As following the amendment of legislative acts. Users of the Q&A tool should therefore check the date of publication of the Q&A and whether the provisions referred to in the answer remain the same.

Please note that the Q&As related to the supervisory benchmarking exercises have been moved to the dedicated handbook page. You can submit Q&As on this topic here.

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List of Q&A's

Deposits by Financial Customers

Do deposits from Financial Customers with a remaining maturity of more than 30 days qualify for a 100% outflow rate for LCR purposes or shall they be excluded from calculation? (e.g. a 3 months unsecured deposit from an investment firm).

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Delegated Regulation (EU) 2015/61 - DR with regard to liquidity coverage requirement
  • ID: 2015_2529
  • Topic: Liquidity risk
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Outflows

Article 423 subparagraph 5(b) states that: 5. The institution shall add an additional outflow corresponding to: (b) collateral that is due to be returned to a counterparty; What is meant by “returned”? Is this intended to be “not yet posted”? Collateral which is due to be posted by the institution, but has not yet been, is not necessarily collateral which is being returned to a counterparty.

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2014_782
  • Topic: Liquidity risk
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Can multiple exemptions be applied to an exposure at the same time?

This question relates to the application of multiple exemptions from article 400 (2) CRR in specific cases. As stated in article 400 (2) CRR „competent authorities may fully or partially exempt exposures“. Which exemption should be applied to an exposure if it falls under the incidence of more than one of the partial exemptions from article 400 (2) CRR? We would like to give an example related to this question. In Germany, a partial exemption of 75% may be applied according to article 400 (2) c) CRR for exposures, excluding participations or other kinds of holdings, incurred by an institution to its parent undertaking, to other subsidiaries of that parent undertaking or to its own subsidiaries, in so far as those undertakings are covered by the supervision on a consolidated basis to which the institution itself is subject, in accordance with this Regulation, Directive 2002/87/EC or with equivalent standards in force in a third country. Furthermore, according to article 400 (2) i) CRR an exemption of 50% may be applied to medium/low risk off-balance sheet undrawn credit facilities referred to in Annex I.

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_2506
  • Topic: Large exposures
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

EBA Q&A 2013_160

This is a follow up question to Q&A 2013_160.A matched (hedged) FX position will result in four cash flows; an inflow in currency 1 and an outflow in currency 2 with counterpart A and an opposite outflow in currency 1 and an inflow in currency 2 with counterpart B.At an all currency LCR level the inflow and outflow with counterpart A can be netted in line with 422(6) and the inflow and outflow of counterpart B can be netted in line with 422(6), giving rise to a net position with each couterpart which will be a very small FX translation difference; one will be a small inflow with one counterpart and one a small outflow with the other counterpart.However at a single currency level the off-setting cashflows are in the same currency, but are not with the same counterpart, and so strictly under LCR rulles they can not be netted. They will therefore be reported gross as an inflow with one counterpart and outflow with the other counterpart, but the inflows will be subject to the 75% cap of outflows in each currency LCR if the 75% cap on inflows apply to both the all currency and the single currency.This will give rise to the sum of the individual currency LCRs showing a worse position than the all currency combined and we question if this is the intended outcome.

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_625
  • Topic: Liquidity risk
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Credit valuation adjustment, standardized method to calculate own funds requirement

"Maturity" definition referred to Art 384 para. 1 for the CVA standardized method calculate for non-IMM banks only refers to Art. 162(2)(b), i.e., derivatives covered by the master netting agreement. However, if derivatives are not included in a netting set and no collateral has been taken into account, how is maturity for the purpose of CVA standardized approach calculation determined?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_622
  • Topic: Other topics
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Grandfathering of Tier 1 instruments w.r.t. Dividend Stoppers and Pushers

When considering the eligibility into Tier 2 for grandfathered Tier 1 instruments - lets use an example where a T1 bond (step or non-step) has a recurring call date only once every 5 years (therefore, from an original maturity perspective it should be eligible for Tier 2 capital as a 5 year bond) Does your comment re. dividend pusher/stopper language restrict the ability of such a bond (assuming it has a dividend pusher/stopper) exclude it from Tier 2 eligibility? If Yes, why are these being treated differently from regular Tier 2 instruments (which do not have dividend pushers/stoppers) that have must pay coupons i.e. an obligation to pay a coupon, which if not paid constitutes a default and thus has stronger implications than on stopping coupons on a T1 bond as mentioned above

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_537
  • Topic: Own funds
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Secured central bank lending and liquidity buffer adjustment

Does the liquidity buffer have to be reduced by outflows from secured lending even if the lender is a central bank and the outflow is 0%-weighted?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Delegated Regulation (EU) 2015/61 - DR with regard to liquidity coverage requirement
  • ID: 2015_2495
  • Topic: Liquidity risk
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Relevance of Recital 50 with regard to the securitisation definition in accordance with Article 4(1) point (61)

The last sentence of Recital 50 of Regulation (EU) No 2013/575 declares: “An exposure that creates a direct payment obligation for a transaction or scheme used to finance or operate physical assets should not be considered an exposure to a securitisation, even if the transaction or scheme has payment obligations of different seniority.” Taking into account that the definition of a securitisation in Article 4(1) point (61) of Regulation (EU) 2013/575 does not permit an exemption for transactions or schemes used to finance or operate physical assets, which exposures are considered as creating a direct payment obligation in the meaning of the last sentence of Recital 50 of Regulation (EU) 2013/575?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_528
  • Topic: Securitisation and Covered Bonds
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Corporate Treasury Entities

How should a non-banking entity within a non-financial group set up to act as a central corporate treasury function be classified for the purposes of LCR?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Delegated Regulation (EU) 2015/61 - DR with regard to liquidity coverage requirement
  • ID: 2015_2426
  • Topic: Liquidity risk
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Definition of 'continuity'

How should the term ‘continuity’ or ‘continuing issue of bonds’ be defined?

  • Legal act: Directive 2013/36/EU (CRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_2337
  • Topic: Other issues
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Non material losses

The definition of what is a non-material loss is not defined within Article 472 of Regulation (EU) No 575/2013 (CRR); is it possible to clarify what ‘material’ / 'non-material' is? Can you advise how- if applicable- such non-material losses are treated?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_448
  • Topic: Own funds
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Market, Credit and Counterparty risks of Central Counterparty under CRR

For Central Counterparty (CCP) acting under Regulation (EU) n°648/2012 (EMIR) with a banking license, - Should the risks already covered by specific financial resources as referred to in Articles 41 to 44 of EMIR be subject to capital requirements under Regulation (EU) n°575/2013? - Should the risks towards a CCP arising from an interoperability arrangement which fulfilled the requirements referred to in Articles 52 and 53 of EMIR and already covered with such requirements be subject to capital requirements under Regulation (EU) n°575/2013?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_2274
  • Topic: Market infrastructures
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Netting Methodologies

Does the EBA intend to issue guidance on the appropriate netting methodologies to be applied. For example, should netting take into account criteria such as currency, cash flow date, product etc. or should a more simplistic approach be used, e.g. adding all the inflows and outflows occurring within the 30 day timeframe to produce a net figure to be reported either as payable to receivable.

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_381
  • Topic: Supervisory reporting
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Liechtenstein is menber of EEA and uses Swiss Francs (CHF).

Liechtenstein is a member of the EEA, but uses Swiss Francs as a domestic currency. Switzerland is not a member of the EEA. Are Swiss Francs to be regarded as a domestic currency like the Euro for the purpose of paragraph 5.

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_323
  • Topic: Other issues
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Consistency regarding the specification of the transition period according to Articles 469(1), 470(2) and 478(2) CRR

How can the applicable percentages of Article 478(2) CRR be applied for the purposes of Article 469(1)(c) CRR until 31.12.2023 provided that the provisions of Article 469(1)(c) and Article 470(2) CRR are applicable only until 31.12.2017?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_261
  • Topic: Own funds
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Applying the two different applicable percentages of Articles 478(1) and 478(2) CRR to the amount exceeding the thresholds of Article 470(2) CRR

How should the two different applicable percentages of Articles 478(1) and 478(2) CRR be applied to the total amount required to be deducted according to Article 36(1)(c) and (i) CRR after applying Article. 470 CRR?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_260
  • Topic: Own funds
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Can the activity consisting in granting credits on own account without collecting deposits or other repayable funds from the public be subject to the requirements of the CRD IV regarding the freedom to provide services and freedom of establishment?

According to Article 4.1 (1) of the CRR, credit institution means an undertaking the business of which is to take deposits or other repayable funds from the public and to grant credits for its own account. The regulations of the CRR and CRDIV are applicable only to the institutions that fulfill both criteria, i.e. the business of which consist of both activities – taking deposits or other repayable funds from the public and granting credits for own account. Only such types of institutions are obliged to be subject to prudential supervision and only to such types of institutions the requirements of authorization and passporting in case of starting cross-border activity are applicable. In some jurisdictions, however, national legislation requires to obtain authorization and to be under prudential supervision from entities which do not accept deposits or other repayable funds but provide some kind of financial activity, in particular, grant different types of credits. This is for example a case of factoring or leasing firms. In these jurisdictions competent authorities require such firms to use passport notification procedure from the CRD IV to notify the intention to start cross-border activity in other Member State. Moreover, these authorities require relevant firms (i.e. leasing or factoring firms) from other Member State to notify the intention to start cross-border activity in jurisdiction of these authorities, using the procedure from the CRD IV. Notwithstanding of the lack of the EU legal basis for such requirements, it must be also noticed that in jurisdictions where such firms are not subject to authorization and prudential supervision, competent authorities have no mandate either to send or accept any notifications regarding the cross-border activity of such firms.

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_2230
  • Topic: Other topics
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Applicable provisions for determining deferred tax assets that rely on future profitability that existed before 1.1.2014

Are the provisions of Article 26(2) CRR regarding independently verified financial statements and permission of competent authorities applicable for determining deferred tax asset that rely on future profitability that existed before 1.1.2014?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_259
  • Topic: Own funds
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Impact of the significant risk transfer on the own funds requirement against specific risk in case of synthetic securitisations in the trading book

May an originator institution of a synthetic securitisation where the securitised exposures are held in the institution’s trading book and the conditions for significant risk transfer in Article 244 are met exclude the securitised exposures and instead only include the securitisation positions resulting from the credit protection obtained in the calculation of its own funds requirement against specific risk?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_68
  • Topic: Securitisation and Covered Bonds
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

The mortgage lending value of the German property

The part of an exposure treated as fully secured by a German property shall be the lower amount of the market value or the mortgage lending value of the property. Does it mean that the mortgage lending value of the German property must be determined so that the property can be treated as collateral? How shall we treat the German property, in which only the market value exists, but not the mortgage lending value?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2014_1023
  • Topic: Credit risk
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022